The currency advanced in three of the four weeks this month
as global funds bought $3.2 billion more Taiwanese stocks than
they sold, according to exchange data. Net purchases were $629
million in the last four days. People’s Bank of China Governor
Zhou Xiaochuan said Aug. 22 adjustments to interest rates and
reserve requirements are possible, and minutes of the last
Federal Reserve meeting released this week showed many policy
makers favor more stimulus.

“There’s money piling up in the stock market and sentiment
has been quite positive,” said Eric Hsing, a fixed-income
trader at First Securities Inc. in Taipei. “Bond traders are
more cautious because we’ve yet to see any concrete actions
taken by central banks.”

Taiwan’s dollar advanced 0.1 percent this week to NT$30
against its U.S. counterpart, according to Taipei Forex Inc. It
slipped 0.1 percent today, while touching a two-week high of
NT$29.82 earlier. One-month implied volatility, a measure of
exchange-rate swings used to price options, dropped 10 basis
points to 3.3 percent during both periods.

The island’s industrial production fell 0.02 percent in
July from a year earlier, a fifth monthly drop, official data
showed yesterday.

The yield on Taiwan’s 1.25 percent notes due March 2022 was
little changed this week and today at 1.182 percent, according
to Gretai Securities Market.

The overnight money-market rate climbed one basis point
today and from the end of last week to 0.393 percent, according
to a weighted average compiled by the Taiwan Interbank Money
Centre.